BMI View : Ghana's construction industry will begin a steady recovery following a contraction over 2015, as the worst of the country's macroeconomic headwinds weighing on growth since 2014 is over. The government has made significant strides in tackling twin deficits, high inflation and a severe power shortage and as such we expect investment in projects to begin to improve.
Latest Updates And Structural Trends
We maintain our forecast of 2.1% real growth in 2016 and average annual growth of 5.3% over the next five years and 6.2% over our full ten-year forecast period up to 2025. We estimate the industry contracted 2% in 2015 as macroeconomic and operational headwinds weighed heavily on growth.
In line with the International Monetary Fund's Emergency Credit Facility programme, the government is reining in recurrent spending. This is positive for the construction industry - while the government is largely responsible for infrastructure financing, much of its expenditure has typically been focused on public sector wages.
Efforts are underway to address the power deficit and the subsequent supply chain disruptions, with an overall improvement in electricity generation expected between 2016 and 2017. Harnessing renewable energy is critical to plug the gap in the short term, but gas-fired capacity will remain the core focus of energy infrastructure development.
Investment into upgrading port and airport infrastructure, as Ghana works to position itself as the gateway to West Africa, underpins our positive forecasts. Expansion and upgrades are in the pipeline for the Tema and Takoradi ports, as well as the country's various airports.
|e/f = BMI forecast. Source: Ghana Central Bank, Ghana Statistical Service, BMI|
|Construction industry value, GHSbn||15.83||18.32||20.81||23.81||27.33||31.53||36.35|
|Construction Industry Value, Real Growth, % y-o-y||-1.99||2.10||4.16||6.00||6.67||7.37||7.26|
|Construction Industry Value, % of GDP||11.5||11.1||10.9||10.8||10.8||10.8||10.9|
Ghana ranks 11 th out of 16 countries in our Sub-Saharan Africa RRI. Its score has improved this quarter to 40.8, from 38.1, though is still below the regional average of 43.2.
The involvement of international donor firms will help to alleviate some of the risks associated with project financing, which could increase private sector interest in key infrastructure projects.
Public corruption, power shortages and liquidity issues in the banking sector remain chief deterrents to operating the market.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Ghana Infrastructure Report features BMI Research's market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.
BMI's Ghana Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Ghanaian infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Ghana to test other views - a key input for successful budgetary and planning in the Ghanaian infrastructure market.
- Target business opportunities and risks in the Ghanaian infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Ghana.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant national and multinational company developments. These are broken down into construction (social, commercial and residential), transport (roads, railways, ports, airports, etc), and energy & utilities (powerplants, pipelines and so on).
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the infrastructure and construction sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (up to 2012) and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key developments in the market and risks to the main forecasts. Indicators include:
Construction: Industry value (USDbn); contribution to GDP (%); total capital investment (USDbn); real growth (%).
Construction industry real growth forecasts (%) and industry value (USDbn) forecasts for industry sectors are split into Residential and Non-residential and Infrastructure sectors. Where the data is available for particular countries the infrastructure is further broken down into indicators for the transport subsectors of roads, railways, airports and ports and the energy and utilities sub-sectors of power plants and transmission grids, oil & gas pipelines and water infrastructure. This dataset is unique to the market.
The reports also include analysis of latest projects across the infrastructure sectors (transport, utilities, commercial construction).
BMI’s Infrastructure Risk Reward Index
BMI’s Risk Reward Index provides investors (construction companies, suppliers and partners) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points. These provide indices of highest to lowest appeal to investors, with each position explained.
An assessment of the competitive landscape and key challenges to entering the market. Details of the largest companies active in the sector across the sub-segments of the industry, including the key financial figures from some of the largest players in the sector.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Infrastructure reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.